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Dec 31, 2020
Energy Recovery Q4 2020 Earnings Report
Achieved product revenue growth and record revenue despite the pandemic, launched new Ultra PX™ and announced share buyback program.
Key Takeaways
Energy Recovery reported a strong finish to 2020 with a 26% increase in product revenue for the fiscal year, driven by a 27% growth in the core seawater desalination business. The company also launched the new Ultra PX™ energy recovery device and approved a $50 million share repurchase program.
Product revenue increased by 67% compared to Q4 2019.
The company reported a net income of $3.5 million, or $0.06 per diluted share, for the fourth quarter.
Water desalination business growth was driven by strong performance in the megaproject (MPD) channel.
Operating expenses decreased by $1.5 million due to lower R&D expenditures.
Revenue by Segment
Forward Guidance
The company anticipates growth in 2021 and 2022, which is expected to increase cash balances. Key steps include demonstrating the value proposition of VorTeq and extending the service life of VorTeq cartridges. They are also working on pressure exchanger capabilities to handle gases and address challenges in industrial and commercial refrigeration.
Positive Outlook
- Projected growth in 2021 and 2022 will increase the Company’s cash balances.
- Deployment of the VorTeq at a live well will help demonstrate the value proposition of the VorTeq.
- The Company will be able to develop the pressure exchanger’s capabilities to handle gases.
- The Company will be able to develop products to address challenges faced in industrial and commercial refrigeration.
- The Company will be able to drive shareholder value.
Challenges Ahead
- The Company will ever commercialize the VorTeq remains uncertain.
- The Company will be able to extend the service life of the VorTeq cartridges remains uncertain.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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